News + Updates

Preparing Ohio Dispensaries for Adult-Use Cannabis Sales

Note: This article was originally published May 22, 2024 on LinkedIn and can be accessed via this link. The information included may be out-of-date.

Since Ohio legalized adult-use cannabis sales on November 7th, 2023, with the passage of Issue 2, dispensary owners have eagerly awaited the finalized rules.

Marijuana Moment recently reported that the Ohio legislation on regulated cannabis was signed off by the Joint Committee On Agency Rule Review (JCARR).

Division of Cannabis Control (DCC) expects to open applications for those with an existing medical license between May 27 and the deadline of June 7, 2024. With the date fast approaching, we’ve broken down what we know about the adult-use retail landscape in The Buckeye State.

When will adult-use sales start?

The Division of Cannabis Control within the Ohio Department of Commerce oversees Ohio dispensary licensing. The Division has confirmed the regulatory framework, with more rules underway and a deadline to issue licenses by September 7th.

Cannabis Business Times reports that dispensaries could open to adult consumers as soon as June, but “[cannabis operators] must be prepared for the increased demand that they aren’t quite sure when is coming. Operators say that despite this limbo period, they are ready, and this comes with the territory when expanding a cannabis market from medical to adult use.”

Speculation aside, it depends on how quickly retailers receive the green light on their licensing applications.

What is going on with licenses in Ohio?

Like many other US states that have adopted adult use, the DCC is giving the earliest opportunities in the adult-use market to existing cannabis businesses in Ohio. Medical (MED) license holders take priority since they’re already equipped to sell cannabis and are familiar with the necessary compliance measures.

A dual-use license covers both adult and medical use. In Ohio’s case, it doesn’t just apply to dispensaries. A medical marijuana-licensed cultivator, processor, testing lab, or dispensary facility may apply to convert its license to a dual-use license of the same type at their current location.

Besides the timeframe benefit, dual-use license applicants also get to forgo the $5,000 application fee. Applicants with a current certificate of operation or medical provisional license issued when the statute was enacted on December 7, 2023, can enter the drawing for a 10(B) dispensary license.

The main difference is that a 10(B) license applies to a new facility location and license type (dual-use or adult sales only). The license fee is $80,000 annually, and a dispensary certificate of operation costs $70,000.

10(B) applicants must submit detailed layouts of their proposed facility location, including security measures, compliant product storage, patient privacy measures, and secured processing areas.

The proposed site can’t be within one mile of an existing dispensary, another proposed applicant’s location, or within 500 feet of a prohibited facility.

The state wants to prevent an overconcentration of dispensaries in the same area. The facility's location must meet all zoning requirements and not fall under local operation prohibitions.

The DCC's Medical-First Approach

The DCC's Medical-First Approach Ohio regulators don’t intend to ignore medical patients’ needs. They require anyone planning to serve REC and MED customers to hold medical-only hours during which no recreational customers can enter the facility. They also require online ordering options for MED patients’ convenience. So how can you prepare for REC?

Maintain compliance (and expand your license) in Ohio with these steps:

1. Provide accommodations for medical marijuana patients, including a self-serve kiosk or drive-up window, a MED-friendly POS, and an app to securely store their MED card.

2. Ensure inventory sufficient to maintain an adequate supply of medical cannabis to meet the current and projected demand. Study adult-use sales trends in surrounding states for what’s to come.

3. Review your compliance and state-reporting protocol setup. Remember, the DCC can inspect your cannabusiness at any point, with or without notice.

Once you’ve ensured compliance, gather and review your application materials. This can include background checks, business plans, proof of financial responsibility, and operational plans.

If you receive a notice of deficiencies from the DCC, you’ll have 10 business days to submit any additional documentation. Guidance published by the DCC states that they expect to issue up to 50 dispensary licenses. Stakeholders can reach out at [email protected].

How can I get ready for 2-3x more customers?

1. Review the DCC’s customer limits.

2. Familiarize yourself with the most recent changes:.

“[The new law] gave the state nine months to set up a system for legal marijuana purchases, subject to a 10% tax. Sales revenue is to be divided between administrative costs, addiction treatment, municipalities with dispensaries, paying for social equity and jobs programs supporting the cannabis industry itself.”

3. Optimize your store layout for efficiency.

4. Enrich your customers’ experience with marketing, promos, and rewards.

With Ohio dispensaries anticipating 2-3 times the influx of customers, you’ll need to find a way to stand out from the competition. Motivate customers with Patient and Customer Education Days featuring local vendor pop-ups, shout your sales from the rooftops with approved marketing tactics, promote your deals in-store, use organic social media channels, online SEO, email marketing, and more.

Adult-use cannabis is becoming the norm, so it’s important to curate an experience for your customers that makes them feel like VIPs. Their weekly cannabis deals should be easy to follow and use. They should be able to choose the ordering method that’s most convenient for them, enter exciting contests, and get rewarded with each spending milestone.

Spendr can help - here's how:

Spendr dispensary partners report a ~22% boost in average transaction value—making cannabis beneficial for everyone. Give your customers fast, modern payments that reward them for buying legal cannabis products.

The best part? You can easily implement our QR-code based payment process in days, not weeks. Plus, there’s no risk with our money-back guarantee. Your customers won’t have to pay ATM fees, and you won’t have to struggle with credit card workarounds. It’s a win-win.

Reach us at [email protected] or click here to learn how we can help you grow.

Disclaimer: This article is intended for informational purposes only and should not be considered legal advice. Consult your state's up-to-date regulations for more.

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